Palladium was the top performer of 2012′s closing quarter. With strong speculative interest driving the market, the metal was able to breach the $700 level in December, a feat that it had not accomplished since Q1. Precious metals came under pressure as the year approached its end, but palladium held up well, ending 2012 at $699, with gains of about $11.

The metal got caught up in negative sentiment sparked by the release of December’s Federal Open Market Committee meeting minutes, which raised questions about the longevity of the Federal Reserve’s bond-buying programs. Prices were down to $685 by January 4.

The market quickly recovered, however, latching onto positive sentiment associated with improved trade data from China the following week. Palladium also benefited from platinum‘s upward moves and renewed optimism about 2013 autocatalyst demand. Those factors allowed the the metal to rise back above $700 by January 11.

The palladium market received more benefits from news that Anglo American Platinum’s (OTC Pink:AGPPY) plans to shutter two mines in South Africa could lead to 14,000 job cuts, The Globe and Mail reported. With supply deficits already in the forecast, this announcement boosted bullish sentiment.

Not only did open interest and net speculative length increase, but last week, holdings in ETFs also rose over 94,000 ounces.

This addition, which is a 12-month record, is the first bold foray into the metal that has been seen in ETFs since the end of November last year, a Standard Bank market note states.

Palladium ended the week breaking above $730.